Statutory Audit
An independent, legally mandatory audit of a company's financial statements, conducted by a chartered accountant, required for essentially all companies regardless of size or turnover.
A statutory audit is an independent examination of a company's financial statements, conducted by a practicing chartered accountant, required under the Companies Act for virtually every registered company, private or public, regardless of turnover or profitability. Its purpose is to give shareholders, lenders, and regulators confidence that the financial statements present a true and fair view, not to catch every possible error but to provide reasonable assurance the numbers aren't materially misstated.
It's distinct from a tax audit, which is turnover-triggered and focused on tax compliance, and from internal audit, which is often voluntary and focused on operational controls. A statutory auditor is appointed by shareholders, has specific independence requirements under law, and their audit report is a mandatory attachment to a company's annual ROC filings.
This glossary entry is for general informational purposes only and does not constitute professional tax, legal, or financial advice. Rules and rates change, so consult a qualified Chartered Accountant for advice specific to your situation.